AT&T today announced that it won a contract from the U.S. Treasury
Department to build and deploy the largest civilian agency network. The
deal has a base of three years with the option for up to seven one-year
extensions that could bring the total value of the contract to $1 billion.

The Treasury Communications Enterprise (TCE) contract, as it is formally
known, will be executed by AT&T and a team of its subcontractors, including
Accenture LLP, BAE Systems, DreamHammer, GTSI, SRA and Lucent
Technologies.

AT&T will build out the TCE which all told encompasses tens of thousand
of users and more than 1,000 domestic locations. According to AT&T,
they'll be building a secure VPN that will handle
all of the department's data, video and voice traffic. The network will
also provide a Web-based interface, so Treasury users will have a
common interface for help desk support, ordering, billing and network
performance information.

"Fundamentally we're going to work on infrastructure," Lou Addeo, president of AT&T Government Solutions,
said on a noon conference call.

He added that the contract is
more than a traditional typical telecommunications contract in that it's a
full service IT contract where AT&T's core network asset is also combined
with network integration, security and a whole range of enhanced services.

Addeo described AT&T's core network asset as "a multi-protocol network which is private and
secure and provides a unified network with a single interface to
customers."

AT&T is no stranger to providing government solutions and has its fair
share of wins this year.

"Today's news
with the Treasury TCE contract is the latest in a string of major contract
wins that we've experienced this year," Addeo said.

Together with partner Lockheed Martin, AT&T won a contract from
the U.S. Postal Service in October, which will provide managed network
services to more than 37,000 locations across the Postal Service
enterprise. That deal could be worth as much $3 billion.

According to Addeo AT&T Government Solutions has won four to six major
contracts this year and has inked many other smaller ones.